MIDLOTHIAN, Va., April 1, 2011 (GLOBE NEWSWIRE) — Bank of Virginia (Nasdaq:BOVA) (www.bankofva.com), has announced financial results for the year ended December 31, 2010.
For the year ended December 31, 2010, the Bank reported a net loss of .2 million, or (.85) per share, compared with a net loss of .2 million or (.39) per share for the year ended December 31, 2009. The loss primarily occurred as a result of a considerable increase in the provision for loan losses from the 2009 amount of .5 million to .0 million in 2010. Further deterioration in the quality of the Bank’s loan portfolio combined with a fourth quarter enhancement of procedures for earlier identification of problem loans led to the additional charges. The Bank improved its net interest income by 7,000, or 4.7%, to .4 million in 2010, compared to .1 million in 2009. The net interest margin for 2010 improved to 3.09% from 2.88% in 2009. The improvement in net interest margin was the result of repricing our interest-bearing liabilities lower by 76 basis points, while the pricing on interest-earning assets was reduced by 48 basis points from 2009.
Review of the balance sheet
The Bank’s total assets decreased .4 million, or 5.6%, to 9.2 million at December 31, 2010 from December 31, 2009’s total of 1.6 million. The main driver behind the reduction of assets was the .6 million, or 16%, decline in net loans from 6.3 million in 2009 to 9.7 million in 2010. The decline in loan balances was attributable to loan charge-offs and pay downs in the absence of significant new lending. The Bank was restricted from loan portfolio growth under the terms of its Written Agreement with banking regulators. Offsetting that reduction in loans was an increase of cash and cash equivalents to .7 million from .1 million, an increase of .6 million, or 217.3%. On the liability side of the balance sheet, total deposits were 1.2 million at December 31, 2010, down from 3.1 million at year end 2009, a drop of .9 million, or 6.2%. The Bank did not renew certain higher costing time deposits in 2010, thereby reducing its costs of funds.�Time deposits balances fell .0 million from 8.2 million at December 31, 2009 to 0.2 million at December 31, 2010. Total liabilities were 2.2 million and 4.4 million at December 31, 2010 and 2009, respectively.��
The Bank’s total capital at December 31, 2010 was .0 million compared to .2 million at December 31, 2009. In December 2010, the Bank restored its well-capitalized status according to regulatory guidelines.�The Bank’s capital ratios at December 31, 2010 were as follows:�tier one leverage capital of 7.9%, tier one risked based capital of 10.9%, and total risked based capital of 12.2%. The Bank closed an equity transaction on December 10, 2010, with Cordia Bancorp, which infused .6 million in new net capital, making the Bank a majority-owned subsidiary of Cordia Bancorp.�
Recent Changes
In December 2010, the Bank enhanced its board oversight through the appointment of six new directors in conjunction with the Cordia transaction.�Furthermore, Jack Zoeller was appointed Chairman, President and Chief Executive Officer and Nancy Corsiglia, Chief Financial Officer, further strengthening the management and operations of the Bank.�
Highlights of 2011 Strategic Plan
In early 2011, the Bank developed a realignment plan for its loan quality and service and delivery system. The major components of the plan are as follows: reduction of full time equivalent staff, Saturday closure of a low traffic retail location, closure of a full�service branch located in close proximity to the Bank’s main office, as well as the hiring new senior credit and lending staff.
“We have made significant improvements to manage the asset quality issues caused by the current credit cycle and continue to take a very conservative approach to lending. �Although the negative results were expected, they do create a great opportunity for the Bank, especially with the additional resources and talent we have added to our Board of Directors and Senior Management team. Moreover, the additional capital from Cordia provides a foundation for repositioning the Bank and returning it to long-term profitability,” said Jack Zoeller, Chairman and CEO.
About Bank of Virginia
Bank of Virginia, a Virginia state chartered bank headquartered in Midlothian, Virginia, currently operates five full-service offices in the counties of Chesterfield and Henrico, Virginia. Bank of Virginia’s common stock is traded on the NASDAQ stock market under the quotation symbol “BOVA”. Additional investor relations information can be found on the internet at www.bankofva.com. Bank of Virginia is a member of the FDIC and Equal Housing Lender.
About Cordia Bancorp
Cordia Bancorp is a private bank holding company incorporated in 2009 by a team of former bank CEOs, directors and advisors seeking to invest in undervalued or troubled community banks in the Mid-Atlantic and Southeast.�Its application to become a bank holding company and to buy a majority interest in the Bank was approved by the Board of Governors of the Federal Reserve in November 2010. Cordia purchased ,300,000 of the Bank’s common stock at a price of .52 per share, resulting in the ownership of approximately 59.8% of the outstanding shares. Additional information about Cordia can be found at www.cordiabancorp.com.
DISCLAIMER
This news release may include forward-looking statements. These forward-looking statements are based on current expectations that involve risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize or should underlying assumptions prove incorrect, actual results may differ materially. These risks include: changes in business or other market conditions; the timely development, production and acceptance of new products and services; the challenge of managing asset/liability levels; the management of credit risk and interest rate risk; the difficulty of keeping expense growth at modest levels while increasing revenues; and other risks detailed from time to time in the Bank’s periodic filings with the Board of Governors of the Federal Reserve System, including the Bank’s annual report on Form 10-K as filed with the Board of Governors of the Federal Reserve. Pursuant to the Private Securities Litigation Reform Act of 1995, the Bank does not undertake to update forward-looking statements contained within this news release.
CONTACT: Jack Zoeller,
Chairman and CEO, 804-763-1333
http://bit.ly/dTAoLN
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